What if the pay plan you've been debating isn't actually the problem?
In this solo episode, Hunt Demarest tackles one of the most argued topics in the auto repair industry: how to pay your technicians. After seeing it debated online once too often, Hunt pulls from hundreds of real shop benchmarks to cut through the noise — and his answer might surprise you.
Hunt breaks down the three main structures — flat rate, hourly/salary, and hybrid — explaining what each one actually incentivizes, where each one breaks down, and why half of his top-performing shops use flat rate while the other half don't. The takeaway: no pay plan alone will fix a production problem.
From the classic flat rate with no minimums to California flat rate, tiered hourly structures, and spiff-based systems, Hunt walks through the real-world mechanics of each — including the overtime trap that catches shop owners off guard when non-discretionary bonuses are in play.
This episode also covers team-based vs. individual pay plans, with a detailed real-world example of a six-tech shop that saw production climb for six months after switching to a team bonus structure — then slide consistently for the next 18. Hunt explains exactly why it happened and what the senior tech said that made it all make sense.
The bottom line: if you change the pay plan without changing how you manage, communicate, and operate, you're just changing the numbers on a piece of paper.
Hunt also previews next week's episode on manager and advisor pay plans, and announces that Reed Melis of Paar Melis & Associates will be teaching a class on shop pay plans at Vision in Kansas City.
What you'll learn…
(00:08) Why Hunt dedicated a full episode to tech pay plans
(01:30) Why half of top benchmark shops are flat rate — and half aren't
(02:59) Understanding flat rate: the core appeal for money-motivated players
(06:46) Can flat rate mask a bad manager — and can hourly survive one?
(09:00) The downsides of flat rate: comebacks, culture, and sick time
(12:00) California flat rate explained
(14:38) Hourly and salary: the easiest pay plan — and its one massive drawback
(17:00) The awkward conversation every hourly shop owner eventually has to have
(19:30) The compliance issue most shops don't know they have
(21:00) The most important rule of any pay plan: if they can't understand it, it won't work
(22:05) Hybrid and tiered rate structures: how they work and who they work for
(24:00) Spiff systems: how a simple $100 bonus can drive a 10% production increase
(25:30) Team-based vs. individual pay plans: the theory, the appeal, and the culture risk
(27:30) Why a team bonus structure boosted production then quietly tanked it
(30:00) Pay plans as a forever-moving target: why honest conversations matter more than the structure itself
Thanks to our partner Promotive
It’s time to hire a superstar for your business; what a grind you have in front of you. Introducing Promotive, a full-service staffing solution for your shop. Promotive has over 40 years of recruiting and automotive experience. If you need qualified technicians and service advisors and want to offload the heavy lifting, visit https://gopromotive.com/
Thanks to our Partner WickedFile
Turn chaos into clarity with WickedFile, the AI for auto repair shops. Transform invoices into insights, protect cash flow, and stop losing parts, cores, or credits to maximize your bottom line. visit https://info.wickedfile.com/
Paar Melis and Associates – Accountants Specializing in Automotive Repair
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